OAG: US Air Carriers Should Look to the South for Growth

An in-depth report that assesses market trends across the Americas and their likely impact upon US based airlines’ commercial strategies has revealed that US Air carriers should look to the South for growth.

OAG, the global leader in aviation intelligence and a UBM Aviation brand, has released the latest in its series of Aviation Market Reports. This new report explores how changing market dynamics within the Americas are impacting US carriers’ growth strategies.

The aftershocks of the global economic downturn are still being felt throughout the so-called “mature” markets of North America and Western Europe. With a small 1% GDP growth in 2011 (versus 2010), the path to recovery in the US is underway albeit slowly. The aviation industry continues to adapt to these conditions with airlines meeting demand by increasing capacity over frequency of flights, in effect offering fewer flights with more seats per flight. This helps manage yield but if it is growth the airlines are after, then surely they will have to look further afield.

Fortunately for the US carriers, the solution is right on their doorstep, just look to the South!

Returning a year-on-year GDP growth rate of 5% and an 11% airline capacity increase in 2011, the Latin American markets represent a huge opportunity to the airlines that can adapt their strategies successfully to meet the demands of these growing markets. “The exceptional growth of the Low Cost Carrier sector across Latin America and the Caribbean has captured everybody’s attention,” said Mike Malik, Chief Commercial Officer UBM Aviation. “If the major US based carriers can adapt their service to compete effectively with the LCC sector, then this region undeniably represents the largest short to mid term growth opportunity for US carriers, whose margins are continually being squeezed in their domestic heartland markets.”

The detailed review of the impact of changing market dynamics upon the Aviation Industry across the Americas is available to download now at www.oagaviation.com/americas-analysis.